San Francisco 'landlords from hell' agree to prison terms

A San Francisco couple who terrorized their tenants to force them to move out and then fled to Italy accept four-year prison terms.

A hole cut into the floor of an apartment at a building owned by Kip and Nicole… (San Francisco district…)

SAN FRANCISCO — A software engineer and his real estate agent wife who terrorized their tenants in a twisted attempt to force them out are back after fleeing to Italy, and each has accepted a four-year-plus prison sentence and two strikes, Dist. Atty. George Gascon announced Wednesday.

Nicknamed the "landlords from hell," Kip and Nicole Macy employed tactics "so outlandish and brazen" in attempting to clear their building of renters that "it sounds like the plot of a horror movie," Gascon said.

Each pleaded guilty to two felony counts of residential burglary, one felony count of stalking and one felony count of attempted grand theft. They are to be sentenced Aug. 22.

Kip Macy's attorney, Lisa DewBerry, said that they could have faced a maximum of 16 years in prison if tried on all charges, but that Gascon "knew he could not prove everything, so he settled for one-quarter of the time that he charged." She called her client "really a good guy" who was at such a disadvantage in the face of San Francisco laws protecting tenants that "he felt he was backed into a corner."

Nicole Macy's attorney, George Borges, said he found the sentence excessive but acknowledged that the couple had behaved "in an absurdly ridiculous criminal manner." His client, he said, "is very remorseful. … She realizes she went crazy and she's paying a price for it."

The story begins in 2005, when Kip, now 38, and Nicole, 37, purchased the building in the South of Market neighborhood with hopes of renovating it and selling its six units. Gascon said they soon set in motion an "insane" two-year campaign against their tenants, replete with antics worthy of cartoon character Wile E. Coyote.

The couple initially pursued evictions under the Ellis Act, which allows owners to get out of the rental game. After tenant Scott Morrow fought the move and prevailed, the Macys on two occasions sawed holes in his floor. Gascon recounted Morrow's shock as he watched a blade emerge through the boards. A friend of Morrow's grabbed a hammer and smashed the saw.

Nicole Macy ordered workers to sever weight-bearing joists in the building's basement — an attempt to have the structure red-tagged as uninhabitable, an indictment eventually handed down by a grand jury said. The couple also cut off the gas, power and water on several occasions.

Nicole Macy also admitted to creating an email account in Morrow's name and sending a message to his attorney, firing him. Another she sent in Morrow's name to her own attorney read: "One day you are going to come home to the Victorian house ... and find [your three children] missing. Then each day a package will arrive with a piece of them."

In 2006, short on money to pay the mortgage, the couple hired Ricardo "Cachi" Cartagena to be the building manager. They directed him to re-rent units that tenants had vacated — in violation of the Ellis Act. The city later sued the Macys, who were served last week with a $916,000 judgment.

But problems developed with new tenants who were sharing an apartment: According to prosecutors, the Macys glued their locks shut, doused their belongings in ammonia and stole jewelry and cash.

Cartagena also became a target for the Macys, who Gascon said threatened the handyman and artist with a handgun.

In an interview Wednesday, Cartagena said the Macys had destroyed many of his paintings. "They couldn't control their anger," Cartagena said. "They were told their actions were illegal, but they thought, 'This is my building, I can do whatever I want with it.'"

The couple were first charged in 2008 and the indictment came the following year. They lost the building to foreclosure. Released on bail, they disappeared shortly before a June 2010 court hearing.

They "got scared, confused, didn't know what to do and made another mistake by fleeing," Borges said.

Although their passports had been confiscated, Nicole Macy managed to get a new one under her maiden name, saying she had misplaced hers, Assistant Dist. Atty. Kelly Burke said. Kip Macy also secured a new passport, but Burke did not know how.

Kip Macy's parents had put up $500,000 for the pair to post bail. In 2011, Al Graf Bail Bonds co-owners Ron Lee and Geri Ito-Campana tracked the fugitives to Florence, Italy. Lee spent three days checking out bookstores, computer stores and a bank machine the pair had used — to no avail.

"Wherever I go around the world, I take a picture of a Chinese restaurant," the former deputy sheriff said. "I found a sign in Florence that said 'Chinatown,' so I figured I'd take the picture." As he raised the camera, he said, he saw the Macys approaching.

Italian authorities declined to take them into custody because there was no extradition order. By the time the district attorney's office issued one, another year had passed and the window to reinstate bail had closed. The half-million-dollar bond had been forfeited.

Italian officials arrested the couple in 2012 in Milan, where they spent a year in jail fighting extradition. Last month, U.S. marshals escorted them to San Francisco.